Westerngeco LLC v. Ion Geophysical Corp. (In re Westerngeco LLC)
| Decision Date | 07 May 2018 |
| Docket Number | 2016-2333,2016-2332,2016-2100,2016-2101,2016-2099,2016-2334 |
| Parties | WESTERNGECO LLC, Appellant v. ION GEOPHYSICAL CORPORATION, ION INTERNATIONAL S.A.R.L., Appellees IN RE: WESTERNGECO LLC, Appellant |
| Court | U.S. Court of Appeals — Federal Circuit |
WESTERNGECO LLC, Appellant
v.
ION GEOPHYSICAL CORPORATION, ION INTERNATIONAL S.A.R.L., Appellees
IN RE: WESTERNGECO LLC, Appellant
2016-2099
2016-2100
2016-2101
2016-2332
2016-2333
2016-2334
United States Court of Appeals for the Federal Circuit
May 7, 2018
Appeals from the United States Patent and Trademark Office, Patent Trial and Appeal Board in Nos. IPR2014-00687, IPR2014-00688, IPR2014-00689, IPR2014-01475, IPR2014-01477, IPR2014-01478, IPR2015-00565, IPR2015-00566, IPR2015-00567.
JOHN C. O'QUINN, Kirkland & Ellis LLP, Washington, DC, argued for appellant. Also represented by WILLIAM H. BURGESS; LESLIE M. SCHMIDT, TIMOTHY GILMAN, New
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York, NY; MICHAEL KIKLIS, CHRISTOPHER RICCIUTI, Oblon, McClelland, Maier & Neustadt, LLP, Alexandria, VA.
GREGORY A. CASTANIAS, Jones Day, Washington, DC, argued for appellees. Also represented by JASON M. GARR, EMILY JUSTINE TAIT, Detroit, MI; DANIELLE J. HEALEY, BRIAN GREGORY STRAND, Fish & Richardson, PC, Houston, TX.
Before WALLACH, CHEN, and HUGHES, Circuit Judges.
CHEN, Circuit Judge.
WesternGeco LLC (WesternGeco) appeals from the final written decisions of the Patent Trial and Appeal Board (Board) in inter partes review (IPR) proceedings instituted on six petitions filed by Petroleum Geo-Services, Inc. (PGS)1 against three patents owned by WesternGeco: U.S. Patent Nos. 7,080,607 (the '607 Patent), 7,162,967 (the '967 Patent), and 7,293,520 (the '520 Patent) (collectively, the WesternGeco Patents). PGS filed its IPR petitions in two rounds: the first three petitions challenged certain claims of each of the three WesternGeco Patents; and the second three petitions challenged additional claims of each of the WesternGeco Patents. After the first round of IPRs was instituted, ION Geophysical Corp. and ION International S.A.R.L. (together, ION) moved, under 35 U.S.C. § 315(c), to join those IPRs. The Board granted ION's request but restricted its involvement to receiving notification of filings and attending, rather than actively participating in, depositions and oral hearings.
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The Board issued six final written decisions, finding all of the instituted claims in the six proceedings to be unpatentable as anticipated or obvious. It also rejected WesternGeco's arguments that the IPR proceedings were time-barred under 35 U.S.C. § 315(b). We conclude that substantial evidence supports the Board's unpatentability determinations, as well as its conclusion that the proceedings were not time-barred. We thus affirm the Board's decisions.
We have familiarity with the WesternGeco Patents through prior appeals. See, e.g., WesternGeco L.L.C. v. ION Geophysical Corp., 837 F.3d 1358, 1364 (Fed. Cir. 2016).2 The WesternGeco Patents are directed to technologies for controlling the movement and positioning of a series of streamers towed in an array behind a ship. These streamers emit acoustic signals and detect the returning signals that reflect from the ocean floor. '967 Patent col. 1, ll. 28-41. The collected data can be used to create a map of the subsurface geology, helping oil companies analyze underwater natural resource formations and explore for oil and gas beneath the ocean floor.
Conventional marine seismic survey systems use long streamers that are towed behind ships in open-water conditions. The streamers, equipped with sensors, can stretch for a mile or more. Vessel movements, weather, and other conditions can cause the streamers to tangle or drift apart. To obtain accurate survey data, it is necessary to control the positioning of the streamers, both vertically in the water, as well as horizontally against
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ocean currents and forces that can cause the normally-parallel streamers to bend and even entangle with each other. Id. at col. 1, l. 42-col. 2, l. 16. The WesternGeco Patents generally relate to a system for controlling the positioning of the streamers in relation to each other by mounting on each streamer a set of "streamer positioning devices" which can realign the individual streamers into their desired positions. Id. col. 2, ll. 56-58.
WesternGeco, PGS, and ION are all participants in the marine seismic survey industry. WesternGeco launched its commercial steerable streamer system, the Q-Marine, in 2000. J.A. 4794. Subsequently, PGS commissioned ION to design and build a competing commercial streamer system, the DigiFIN, which launched several years later. Id.
In 2009, WesternGeco sued ION in the U.S. District Court for the Southern District of Texas (the District Court) for infringement of the WesternGeco Patents, as well as the '038 Patent. To assist in developing its infringement case against ION, WesternGeco served PGS with a third-party subpoena, seeking information relating to PGS's use and operation of ION's DigiFIN product. In response, PGS appeared (through its own counsel) in the lawsuit as a third party and produced documents, but did not file anything in that litigation. In August 2012, a jury returned a verdict finding ION had infringed all four patents asserted and that ION had failed to prove that any of the asserted patents were invalid. On appeal, this court affirmed all aspects of the District Court's judgment except for willful infringement and damages.3
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After receiving a favorable infringement verdict against ION, WesternGeco next sued PGS in the District Court for allegedly-related infringement of the same four patents ION had been found to have infringed. In response, PGS sought to have the patent claims asserted against it administratively cancelled, by filing at the Board the two rounds of inter partes review petitions discussed above. The Board denied institution of review for the petitions concerning the '038 Patent but instituted review on all six of PGR's IPR petitions concerning the WesternGeco Patents, finding a reasonable likelihood that PGS would prevail with respect to the challenged claims.
After the first round of PGS's petitions had been instituted, ION moved to join those proceedings. Both WesternGeco and PGS opposed. WesternGeco argued that joinder would create delay and complicate the PGS IPR schedule. PGS, for its part, expressed concern that WesternGeco would seek to add a "substantial volume of testimony" from the ION litigation to the IPR proceeding. PGS added that such testimony would be highly prejudicial because it did not have the opportunity to participate in the ION lawsuit. After considering the arguments, the Board granted ION's request to join PGS's first round of IPRs, but restricted ION's role to "spectator" status, meaning that it had no right "to file papers, engage in
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discovery, or participate in any deposition or oral hearing." J.A. 13439. ION did not join the second round of IPRs.
The Board issued six final written decisions (two decisions per patent), finding that various claims were either anticipated by or would have been obvious over several prior art references. See generally Petroleum Geo-Servs., Inc. v. WesternGeco L.L.C. (PGS I), No. IPR2014-00687, 2015 WL 10378275 (P.T.A.B. Dec. 15, 2015) (J.A. 1-44) (invalidating claims 1 and 15 of the '967 Patent); Petroleum Geo-Servs., Inc. v. WesternGeco L.L.C. (PGS II), No. IPR2014-00688, 2015 WL 10378495 (P.T.A.B. Dec. 15, 2015) (J.A. 45-99) (invalidating claims 1 and 15 of the '607 Patent); Petroleum Geo-Servs., Inc. v. WesternGeco L.L.C. (PGS III), No. IPR2014-00689, 2015 WL 10380984 (P.T.A.B. Dec. 15, 2015) (J.A. 100-52) (invalidating claims 1-2 and 18-19 of the '520 Patent); Petroleum Geo-Servs., Inc. v. WesternGeco L.L.C. (PGS IV), No. IPR2014-01475 (P.T.A.B. Mar. 16, 2016) (J.A. 153-216) (invalidating claim 4 of the '967 Patent); Petroleum Geo-Servs., Inc. v. WesternGeco L.L.C. (PGS V), No. IPR2014-01477 (P.T.A.B. Mar. 16, 2016) (J.A. 217-95) (invalidating claims 16-23 of the '607 Patent); Petroleum Geo-Servs., Inc. v. WesternGeco L.L.C. (PGS VI), No. IPR2014-01478 (P.T.A.B. Mar. 16, 2016) (J.A. 296-359) (invalidating claims 3, 5, 13-17, 20, 22, and 30-34 of the '520 Patent).
WesternGeco appealed the Board's decisions in PGS I-VI to this court. The appeals were consolidated, listing both PGS and ION as Appellees. See Order at 1-2, ECF No. 27. In relevant part, WesternGeco argued that the Board deprived WesternGeco of due process and violated the Administrative Procedure Act by denying WesternGeco the opportunity to be heard on whether the inter partes reviews were time-barred pursuant to 35 U.S.C. § 315(b). WesternGeco also reserved rights to file additional briefing in light of our then-pending en banc reconsideration of Wi-Fi One, LLC v. Broadcom Corp., 837 F.3d
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1329 (Fed. Cir. 2016). PGS filed a response brief, and ION "join[ed] in and adopt[ed] by reference" PGS's brief rather than filing its own. ION's Joinder in the Br. of PGS at 1, ECF No. 50; see Order at 2, ECF No. 51.
After briefing was completed in this appeal, PGS settled with WesternGeco and filed a motion to withdraw. See PGS's Unopposed Mot. to Withdraw at 2, ECF No. 82. We granted PGS's motion, ordered the USPTO to inform the court whether it intended to intervene, and ordered WesternGeco and ION to file a joint status report. See Order at 2, ECF No. 86. The USPTO declined to intervene. Upon consideration of the parties' report, we ordered ION to file a new brief, addressing only PGS I-III, and permitted WesternGeco to file a new reply brief. Order at 2, ECF No. 92.
Shortly before the date scheduled for oral argument, we issued our en banc decision in Wi-Fi One v. Broadcom Corp., 878 F.3d 1364 (Fed. Cir. 2018) (en banc). Wi-Fi One held that "time-bar determinations under [35 U.S.C.] § 315(b) are reviewable by this court" and overruled our prior contrary precedent. Id. at 1374. Consequently, WesternGeco requested leave to file supplemental briefing regarding the proper legal standard to determine whether a party is a "real party in interest, or privy of the petitioner" under 35 U.S.C. § 315(b) and whether ION was a...
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